Dirty Gas

Dirty Gas

The Environment Centre NT has an ambitious agenda for transitioning the Territory away from fossil fuels towards renewable energy for domestic use and potentially export, protecting sensitive ecosystems and important ecological processes from the oil and gas sector, and ensuring carbon pollution levels stabilise and fall by 2020.

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Whilst the gas boom will bring major economic growth to parts of the Territory, it also has substantial impacts and risks.

While Territory Labor and the Country Liberals refer to gas as 'clean' because it contains less carbon than coal and oil, it is very dirty compared to renewable energy. This is the logical benchmark for a century in which the world must move rapidly away from all fossil fuels to renewable energy.

Territory carbon pollution levels will increase markedly in the absence of a combination of federal carbon cap-and-trade system that achieves rapid national emission cuts, and government-mandated conditions on projects approvals that require heavy industry to achieve carbon neutrality over a project's life cycle.

The gas boom will also place our economy at long term risk as the world increasingly moves to place a price on carbon, cut pollution and move to renewable energy.

The Territory Government’s plans to making Darwin the gas hub of Northern Australia will make Darwin Harbour an industrialized and potentially polluted harbour, with marine wildlife subject to heightened underwater noise impacts from shipping, dredging and blasting.

The Territory currently has a single liquefied natural gas (LNG) ‘train’ (or processing plant) in Darwin Harbour, namely Darwin LNG operated by ConocoPhillips. The INPEX Ichthys LNG plant is due for construction from early 2012, and will have two trains in Stage 1, with a potential additional four trains to be built as more gas is found.

Each new LNG train increases Australia’s carbon pollution levels by 0.5%, on average, because of the massive amounts of electricity needed to freeze the gas into liquids to store it on boats for export.

The potential exists for more gas to be piped to the Darwin LNG or INPEX LNG plants from gas fields in the Arafura and Timor Seas, which would have lower impacts on Darwin Harbour than new LNG plants being built, but would see carbon pollution levels rise even further.

The marine supply base would also service up to ten Floating LNG ships proposed for construction across the Arafura and Timor Seas, thereby further focusing our economy on fossil fuels.

Onshore, exploration for oil and gas is currently occurring across 70% of the Territory.

Unconventional shale gas is a major risk to the Territory’s efforts to cut carbon pollution, and to protect sensitive landscapes and water resources, National Parks, and valuable pastoral lands.

The impact of hydraulic fracturing has been a public concern overseas, including the United States, Great Britain, Ireland and France. In Lancashire, UK, fraccing was suspended after fears that the process was linked to minor earthquakes and tremors and due to public concern about the potential for contamination. France has officially banned the use of hydraulic fracturing for the exploration and exploitation of shale gas and shale oil and there is currently a moratorium on fraccing within South Africa’s Karoo region.

Fraccing has occurred in Canada since the 1990s, although recent concern has arisen due to water access arrangements; however the practice has temporarily been suspended in Quebec while an environmental review is undertaken. Hydraulic fracturing has generated public scrutiny and concern within the US although the US EPA has found that there was little to no risk of fracturing fluid contaminating underground sources of drinking water during hydraulic fracturing of coalbed methane production wells.

Within Australia, a parliamentary committee was established in NSW to investigate the environmental, economic and social impacts of coal seam gas mining.

What’s it all about and what does it mean for the Northern Territory?

What is Hydraulic Fracturing?

Hydraulic fracturing (fraccing) is a well stimulation process used to maximize the extraction of underground resources; including oil, natural gas, and geothermal energy.

The process of hydraulic fracturing begins with building the necessary site infrastructure including well construction. Production wells may be drilled in the vertical direction only or paired with horizontal or directional sections. Fluids, commonly made up of water and chemical additives, are then pumped into a geologic formation at high pressure and when the pressure exceeds the rock strength, the fluids open or enlarge fractures. After the fractures are created, a propping agent is pumped into the fractures to keep them from closing. The created fractures then provide a conductive path connecting a larger area of the reservoir to the well, increasing the area from which natural gas and liquids can be recovered from the targeted formation.

Key Issues

Impacts on water quality. There are claims that fraccing creates cracks in rock formations that allow chemicals to leach into sources of fresh water. Calculations performed by (US) EPA show that at least nine hydraulic fracturing chemicals may be injected into or close to underground sources of drinking water at concentrations that pose a threat to human health. These chemicals may be injected at concentrations that are anywhere from 4 to almost 13,000 times the acceptable concentration in drinking water.[3] The National Industrial Chemical Notification and Assessment Scheme (NICNAS), has assessed only 2 out of the 23 known compounds used in fraccing fluids in Australia.[4]

In October 2010, traces of BTEX chemicals were found at an Arrow Energy fraccing operation in Queensland. Arrow Energy confirmed that benzene, toluene, ethylbenzene and xylene had been found in well water associated with its coal-seam gas operation at Moranbah, west of Mackay. An underground coal gasification project, a joint venture between Origin and the multinational ConocoPhillips, near Kingaroy Queensland, was also temporarily shut down when benzene and toluene were detected. Queensland has banned the use of BTEX chemicals in fraccing fluids. [5]

Wastewater management. 60 – 80% of fracturing fluids return to the surface as flowback. When contaminated with the byproducts of the hydraulic fracturing process, this wastewater is referred to as ‘produced water’. In addition to the fraccing fluids added by the gas drilling companies, this water picks up other contaminants from deep in the earth, with one of the most notable ingredients being salt.This fluid combination becomes brine wastewater andbrine wastewater is difficult and expensive to treat.

Impacts on Aquifers. Impacts include aquifer drawdown as well as contamination. For example, industry predicts groundwater drawdown for the Arcadia Valley and Fairview CSG fields within the Bowen Basin, Queensland of up to 15 metres by 2013 and 65 metres by 2028. Drill holes or fractures may intersect with one or multiple aquifers potentially mixing groundwater from different strata or altering the groundwater chemistry through exposure to the air, gas, fraccing chemicals and drilling fluids. [6]

Landscape values.Within many areas of the Territory consideration needs to be given to the visual impact of gas well infrastructure on landscape values. The exploitation of unconventional shale gas fields will change the visual feel of existing natural or rural landscapes, becoming “industrial” in nature. In addition to pipelines, evaporation ponds, water storage tanks, well heads, roads and trucks the landscape will become littered with gas flares (gas flare or flare stacks are used in gas wells to ‘dispose’ of waste gas). Landscape and ecosystem value will also be compromised by the indirect impacts of gas exploration and exploitation – notably through weed invasion associated with increased access across the landscape.

Is the Northern Territory at risk?

Yes. Exploration permits have been issued under the Petroleum Act for unconventional shale gas reserves, the most notably being in the Barkly district. The Territory could see literally many thousands of wellheads built across the Barkly, plus elsewhere.

From a regulatory perspective, the Territory is not ready for this type of industry. Onshore gas projects are regulated by the Petroleum Act and Schedule of Onshore Petroleum Exploration and Production Requirements. Neither of these laws provide adequate protection for the environment or consideration of social and cultural issues. They are not informed by the principles of ecologically sustainable development and do not easily link to the Environmental Assessment Act to ensure adequate assessment is made of an unconvential shale gas proposal. They do not specify environmental standards or include environmental offence provisions . Nor do they include public participation provisions, including the public’s right to say “no” to a proposal, or provide third party appeal provisions.

The Environment Centre NT would like to see the Territory Government follow the NSW Government’s lead and undertake a Public Inquiry to determine the suitability of this industry for the Northern Territory. Such an inquiry would need to examine:

The adequacy of the legislative and regulatory environment.

The environmental, climate and health impacts and risks of unconventional shale gas extraction.